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This whole crypto wave since early Bitcoin is so insane. The entire idea was to have a truly decentralized monetary system outside the control of institutions.

This whole crypto wave since early Bitcoin is so insane. The entire idea was to have a truly decentralized monetary system outside the control of institutions. But it so happens that almost everyone deposit them in institutions, and when a problem/hack occurs, no one can help because well… it is outside the control of institutions. All the disadvantages without the advantages.

paulpauper 2y ago
An exchange is no more of an institution than an online casino.
golergka 2y ago
> almost everyone deposit them in institutions Why do you think so? Of course, we all hear about people who lose it all in crypto exchanges. But how would we hear about the ones who don't?
- lukevp 2y ago
  As I understand it, the software surrounding and managing the wallets is always what’s compromised, right? So it’s really the exchanges are the only place that the money is being lost, because the protocol itself is sound.
  - FabHK 2y ago
    Yes, it's always the user's fault if they lose their crypto, because crypto outsources the hard parts, such as key management, to the user.
  - stouset 2y ago
    Countless amounts of money has been lost off-exchange. The entire reason people use exchanges is because holding your own crypto is laughably hard. Forgot your password? All your money is gone. Hard drive crashed and no backups? All your money is gone. Accidentally installed malware? All your money is gone. Spouse or parent with all the coins died? All the money is gone. Fat-finger a value in a transaction? Lots of your money is gone. Yes there are “solutions” to all of these problems. All of them are Rube Goldberg contraptions themselves and have their own failure modes.
- Hamuko 2y ago
  You mean like the stories of people who lost their crypto because they lost the HDD they were stored on?
- gloomyday 2y ago
  Sorry, I wrote this, but it is just a guess. I say that because of the size of exchanges, and I know most people are in this because they think they can sell for a profit later (both amateurs and professionals). The truth is hard to know. I wonder how many people lost their coins to the ether by losing their keys or sending to the wrong wallets.
- snailmailstare 2y ago
  > But how would we hear about the ones who don't? I hear stories about them and whether the con-artist got access to their digital wallet, whether they made it to a safe room in the home invasion and, of course, whether they got rights to mine the dump.
cgcrob 2y ago
Elegantly put. The biggest lie that is told about crypto is that writing off a few thousand years of experience with money will make problems go away.
fallinditch 2y ago
Yes agreed, but the 'idea' is diluted when it's only about decentralized money. The truly powerful promise of Web3/crypto decentralization is in creating alternative economic ecosystems that empower users and communities. We're obviously still in the teething stages of the technology and need some serious improvements to underlying security; and to move beyond scams and ponzi structures.
- woodruffw 2y ago
  > The truly powerful promise of Web3/crypto decentralization is in creating alternative economic ecosystems that empower users and communities. What does this mean? It’s indistinguishable from marketing chaff. It occurs to me that the biggest recent successes in “alternative” ecosystems have absolutely nothing to do with cryptocurrencies. Mastodon comes to mind.
  - hecanjog 2y ago
    I'm sort of worried they're hinting at these "network states", which seem well placed to not only trick people into parting with their money, but also potentially their homes. https://www.bbc.com/news/articles/cwyl171lyewo https://www.bbc.com/news/articles/cwyl171lyewo
  - fallinditch 2y ago
    Yes it does sound like marketing speak, my bad. So deFi can help users and communities because decentralized financial systems, allow users to lend, borrow, and trade without intermediaries, enhancing financial inclusivity and reducing costs. Web3 technologies can facilitate community-driven initiatives, e.g. regenerative finance (ReFi), which supports climate action and equitable resource allocation. Also some interesting things happening around DAOs (decentralized autonomous organizations) e.g. Venture DAOs supporting new business creation. In general the principles behind having reduced intermediaries, and having user control and ownership of user data, together with enlightened uses of smart contract and other Web3 technologies is empowering, especially if it's put to use to solve real world problems. I do think that it's difficult to see past the sometimes murky shenanigans and greed often on display in Web3. But I think decentralization is a paradigm shift, it's going to take some visionary entrepreneurs and technologists to continue to build out the promise but I believe that it will happen.
turtlesdown11 2y ago
> decentralized monetary system Is there an example of a crypto system that is actually used for legitimate monetary transactions? Excluding money laundering and moving money offshore?
- singpolyma3 2y ago
  Bitcoin obviously. But many other major currencies are used for ecommerce as well.
- artursapek 2y ago
  USDC is becoming pretty popular. It's on every major chain, and has a native bridge by Circle. On Solana you can send millions of dollars in USDC, in a few seconds, for less than a penny.
  - nailer 2y ago
    I think HN is about 7-8 years behind tech when it comes to crypto. You still hear people talking about ‘gas fees’, slow transaction times, and people like the parent have no idea the variety of asset classes that are tradable onchain.
    - turtlesdown11 2y ago
      Sorry, again, what exact use cases do these crypto assets have? Could you provide evidence of them being used in monetary transactions on a regular basis?
      - nailer 2y ago
        As an individual, I have a Lulu account, which is effectively a savings account like a normal bank (i.e. I loaned my money out to other people and receive interest) with a much higher rate. As an angel investor, I use USDC to instantly send money to companies I am investing in. I personally don’t have an interest in a money market account, but the money market account on crypto works exactly like a money market account outside of crypto except available 24 hours a day. I might rent in Brooklyn in future, so I might wish to be able to access the parcl account for Brooklyn and be able to offset Brooklyn rent increases by buying tokenized Brooklyn Real Estate.
artursapek 2y ago
Crypto is un-censorable money. Everybody buying it knows that. If you want un-censorable money, you have to accept the fact that transfers are only verified by cryptography, and irreversible. You can't have one without the other.
- akerl_ 2y ago
  I'm trying to square your comment here and https://news.ycombinator.com/item?id=43151500 https://news.ycombinator.com/item?id=43151500 . It seems like this money is pretty censorable, it's just a different group doing the censoring.
- FabHK 2y ago
  The people running Bitcoin came together to fix things they didn't like, rolling back some 20+ blocks in the process, at least twice. The people running Ethereum have no problem with scams and child porn and drugs and money laundering, but hacking the DAO, that's unacceptable and was reversed.
onlyrealcuzzo 2y ago
> All the disadvantages without the advantages The advantage to the vast majority of crypto investors / holders is a high speculative return. If BTC was still worth a fraction of a cent, (almost) no one would be investing in it for th decentralized nature.
- deleted 2y ago
  [deleted]
- FabHK 2y ago
  If you look at the market cap of coins, it is obvious that nobody gives a flying fuck about the underlying technology. Bitcoin copies/forks like Litecoin and Bitcoin Cash, jokes like Dogecoin and Shiba Ina, memecoins like $TRUMP are in the top 50, while innovative protocols like Chia are at rank 250 or so.
  - panarky 2y ago
    > nobody gives a flying fuck about the underlying technology That's the thing about money and value. Value is a social construct. Value is not created by the underlying technology. Value comes from collective agreement among human beings. That's why copying a coin doesn't automatically make the copy valuable.
    - FabHK 2y ago
      Sure. The thing is, sometimes social sentiment changes. Fiat tends to remain stable and valuable, because it is carefully managed to that end, and is the legally sanctioned method to extinguish debt and pay taxes. Crypto is nothing but magic beans and a bad database. If its value falls, there's nothing to stop the fall but sentiment.
    - onlyrealcuzzo 2y ago
      > Value comes from collective agreement among human beings. It can also come from fraud, market manipulation, etc
  - 2y ago
ArtTimeInvestor 2y ago
All the disadvantages Except inflation. The amount of Dollars has tripled since Bitcoin was invented: https://fred.stlouisfed.org/series/BOGMBASE https://fred.stlouisfed.org/series/BOGMBASE Bitcoin is capped at 21 million. The Dollar is expected to lose almost all value over the lifetime of a person. Warren Buffett once noted that the Dollar already lost over 90% of it's value during his lifetime. With Bitcoin, there is no such expectation.
- auc 2y ago
  Finite amount of gold as well. Finite amount of bitcoin cash as well. Finite amount of real estate as well.
  - ArtTimeInvestor 2y ago
    The amount of Gold in circulation rises by about 2% per year. For new real estate, there is also basically an infinite amount that can be added to the market. Planet earth is still mostly unused. Bitcoin Cash has no USP that could lead to it becoming the digital Gold instead of Bitcoin.
    - FabHK 2y ago
      What's the irrevocable USP that Bitcoin has? Is it because it was first, like Yahoo, MySpace, and Friendster?
      - ArtTimeInvestor 2y ago
        Yahoo, MySapce and Friendster are services. Bitcoin is a protocol. Like TCP: https://en.wikipedia.org/wiki/Transmission_Control_Protocol https://en.wikipedia.org/wiki/Transmission_Control_Protocol
    - auc 2y ago
      The amount of BTC in circulation is increasing per year as well. There’s a finite amount of gold on Earth. Real estate is definitely not “infinite”. Especially if you consider arable land and weather patterns.
bloomingkales 2y ago
Plus there's the reality that the US can derail any plans for de-dollarizing by simply buying up crypto, in which case crypto is now fully backed by the dollar and becomes the same exact reserve currency as the dollar. This is the most strategic defensive play the US can do, so unfortunately the case for BTC to get to a million is a valid one. It's outrageous, but missing this move will leave a lot of people even poorer, and it will happen all of a sudden. They are accumulating right now, and one day they will just set the new high price.
duxup 2y ago
The people will make the market regardless of a coders intention it seems.

paulpauper 2y ago

An exchange is no more of an institution than an online casino.

golergka 2y ago

> almost everyone deposit them in institutions Why do you think so? Of course, we all hear about people who lose it all in crypto exchanges. But how would we hear about the ones who don't?

lukevp 2y ago
As I understand it, the software surrounding and managing the wallets is always what’s compromised, right? So it’s really the exchanges are the only place that the money is being lost, because the protocol itself is sound.
- FabHK 2y ago
  Yes, it's always the user's fault if they lose their crypto, because crypto outsources the hard parts, such as key management, to the user.
- stouset 2y ago
  Countless amounts of money has been lost off-exchange. The entire reason people use exchanges is because holding your own crypto is laughably hard. Forgot your password? All your money is gone. Hard drive crashed and no backups? All your money is gone. Accidentally installed malware? All your money is gone. Spouse or parent with all the coins died? All the money is gone. Fat-finger a value in a transaction? Lots of your money is gone. Yes there are “solutions” to all of these problems. All of them are Rube Goldberg contraptions themselves and have their own failure modes.
Hamuko 2y ago
You mean like the stories of people who lost their crypto because they lost the HDD they were stored on?
gloomyday 2y ago
Sorry, I wrote this, but it is just a guess. I say that because of the size of exchanges, and I know most people are in this because they think they can sell for a profit later (both amateurs and professionals). The truth is hard to know. I wonder how many people lost their coins to the ether by losing their keys or sending to the wrong wallets.
snailmailstare 2y ago
> But how would we hear about the ones who don't? I hear stories about them and whether the con-artist got access to their digital wallet, whether they made it to a safe room in the home invasion and, of course, whether they got rights to mine the dump.

cgcrob 2y ago

Elegantly put. The biggest lie that is told about crypto is that writing off a few thousand years of experience with money will make problems go away.

fallinditch 2y ago

Yes agreed, but the 'idea' is diluted when it's only about decentralized money. The truly powerful promise of Web3/crypto decentralization is in creating alternative economic ecosystems that empower users and communities. We're obviously still in the teething stages of the technology and need some serious improvements to underlying security; and to move beyond scams and ponzi structures.

woodruffw 2y ago
> The truly powerful promise of Web3/crypto decentralization is in creating alternative economic ecosystems that empower users and communities. What does this mean? It’s indistinguishable from marketing chaff. It occurs to me that the biggest recent successes in “alternative” ecosystems have absolutely nothing to do with cryptocurrencies. Mastodon comes to mind.
- hecanjog 2y ago
  I'm sort of worried they're hinting at these "network states", which seem well placed to not only trick people into parting with their money, but also potentially their homes. https://www.bbc.com/news/articles/cwyl171lyewo https://www.bbc.com/news/articles/cwyl171lyewo
- fallinditch 2y ago
  Yes it does sound like marketing speak, my bad. So deFi can help users and communities because decentralized financial systems, allow users to lend, borrow, and trade without intermediaries, enhancing financial inclusivity and reducing costs. Web3 technologies can facilitate community-driven initiatives, e.g. regenerative finance (ReFi), which supports climate action and equitable resource allocation. Also some interesting things happening around DAOs (decentralized autonomous organizations) e.g. Venture DAOs supporting new business creation. In general the principles behind having reduced intermediaries, and having user control and ownership of user data, together with enlightened uses of smart contract and other Web3 technologies is empowering, especially if it's put to use to solve real world problems. I do think that it's difficult to see past the sometimes murky shenanigans and greed often on display in Web3. But I think decentralization is a paradigm shift, it's going to take some visionary entrepreneurs and technologists to continue to build out the promise but I believe that it will happen.

turtlesdown11 2y ago

> decentralized monetary system Is there an example of a crypto system that is actually used for legitimate monetary transactions? Excluding money laundering and moving money offshore?

singpolyma3 2y ago
Bitcoin obviously. But many other major currencies are used for ecommerce as well.
artursapek 2y ago
USDC is becoming pretty popular. It's on every major chain, and has a native bridge by Circle. On Solana you can send millions of dollars in USDC, in a few seconds, for less than a penny.
- nailer 2y ago
  I think HN is about 7-8 years behind tech when it comes to crypto. You still hear people talking about ‘gas fees’, slow transaction times, and people like the parent have no idea the variety of asset classes that are tradable onchain.
  - turtlesdown11 2y ago
    Sorry, again, what exact use cases do these crypto assets have? Could you provide evidence of them being used in monetary transactions on a regular basis?
    - nailer 2y ago
      As an individual, I have a Lulu account, which is effectively a savings account like a normal bank (i.e. I loaned my money out to other people and receive interest) with a much higher rate. As an angel investor, I use USDC to instantly send money to companies I am investing in. I personally don’t have an interest in a money market account, but the money market account on crypto works exactly like a money market account outside of crypto except available 24 hours a day. I might rent in Brooklyn in future, so I might wish to be able to access the parcl account for Brooklyn and be able to offset Brooklyn rent increases by buying tokenized Brooklyn Real Estate.

artursapek 2y ago

Crypto is un-censorable money. Everybody buying it knows that. If you want un-censorable money, you have to accept the fact that transfers are only verified by cryptography, and irreversible. You can't have one without the other.

akerl_ 2y ago
I'm trying to square your comment here and https://news.ycombinator.com/item?id=43151500 https://news.ycombinator.com/item?id=43151500 . It seems like this money is pretty censorable, it's just a different group doing the censoring.
FabHK 2y ago
The people running Bitcoin came together to fix things they didn't like, rolling back some 20+ blocks in the process, at least twice. The people running Ethereum have no problem with scams and child porn and drugs and money laundering, but hacking the DAO, that's unacceptable and was reversed.

onlyrealcuzzo 2y ago

> All the disadvantages without the advantages The advantage to the vast majority of crypto investors / holders is a high speculative return. If BTC was still worth a fraction of a cent, (almost) no one would be investing in it for th decentralized nature.

deleted 2y ago
[deleted]
FabHK 2y ago
If you look at the market cap of coins, it is obvious that nobody gives a flying fuck about the underlying technology. Bitcoin copies/forks like Litecoin and Bitcoin Cash, jokes like Dogecoin and Shiba Ina, memecoins like $TRUMP are in the top 50, while innovative protocols like Chia are at rank 250 or so.
- panarky 2y ago
  > nobody gives a flying fuck about the underlying technology That's the thing about money and value. Value is a social construct. Value is not created by the underlying technology. Value comes from collective agreement among human beings. That's why copying a coin doesn't automatically make the copy valuable.
  - FabHK 2y ago
    Sure. The thing is, sometimes social sentiment changes. Fiat tends to remain stable and valuable, because it is carefully managed to that end, and is the legally sanctioned method to extinguish debt and pay taxes. Crypto is nothing but magic beans and a bad database. If its value falls, there's nothing to stop the fall but sentiment.
  - onlyrealcuzzo 2y ago
    > Value comes from collective agreement among human beings. It can also come from fraud, market manipulation, etc
- 2y ago

ArtTimeInvestor 2y ago

All the disadvantages Except inflation. The amount of Dollars has tripled since Bitcoin was invented: https://fred.stlouisfed.org/series/BOGMBASE https://fred.stlouisfed.org/series/BOGMBASE Bitcoin is capped at 21 million. The Dollar is expected to lose almost all value over the lifetime of a person. Warren Buffett once noted that the Dollar already lost over 90% of it's value during his lifetime. With Bitcoin, there is no such expectation.

auc 2y ago
Finite amount of gold as well. Finite amount of bitcoin cash as well. Finite amount of real estate as well.
- ArtTimeInvestor 2y ago
  The amount of Gold in circulation rises by about 2% per year. For new real estate, there is also basically an infinite amount that can be added to the market. Planet earth is still mostly unused. Bitcoin Cash has no USP that could lead to it becoming the digital Gold instead of Bitcoin.
  - FabHK 2y ago
    What's the irrevocable USP that Bitcoin has? Is it because it was first, like Yahoo, MySpace, and Friendster?
    - ArtTimeInvestor 2y ago
      Yahoo, MySapce and Friendster are services. Bitcoin is a protocol. Like TCP: https://en.wikipedia.org/wiki/Transmission_Control_Protocol https://en.wikipedia.org/wiki/Transmission_Control_Protocol
  - auc 2y ago
    The amount of BTC in circulation is increasing per year as well. There’s a finite amount of gold on Earth. Real estate is definitely not “infinite”. Especially if you consider arable land and weather patterns.

bloomingkales 2y ago

Plus there's the reality that the US can derail any plans for de-dollarizing by simply buying up crypto, in which case crypto is now fully backed by the dollar and becomes the same exact reserve currency as the dollar. This is the most strategic defensive play the US can do, so unfortunately the case for BTC to get to a million is a valid one. It's outrageous, but missing this move will leave a lot of people even poorer, and it will happen all of a sudden. They are accumulating right now, and one day they will just set the new high price.

duxup 2y ago

The people will make the market regardless of a coders intention it seems.